Two homebuilders that recently started construction on separate condo projects in the Metro Vancouver city of Surrey suggest the region could be facing a condo shortage if the pipeline of new projects continues as a trickle. 

As many developers in the region have delayed or halted condo projects, or turned developments into purpose-built rentals due to poor market conditions and slow pre-sales, both Zenterra Developments and Allure Ventures believe the timing could be ripe for their buildings. 

Housing starts of all types in the Vancouver region are trending down. Condo starts could range from a low of 17,400 to a high of 21,200 units this year, the CMHC said in its 2026 National Housing Market Outlook. That would continue a downward trend from 21,844 last year, 23,282 in 2024 and 27,576 in 2023. By 2028, the high for condo starts could be 17,600. 

Hence the decisions by both Zenterra and Allure to break ground in Surrey this month. 

Zenterra's Atlin and Butte condos

Surrey-based Zenterra is building a master-planned, residential project in the Clayton area along the Fraser Highway near 72nd Avenue. Derek Fenton, vice-president with Zenterra, told RENX it has started site prep and excavation to construct the first two condo buildings at the site: Bute and Atlin. 

He said a key to reaching this milestone has been designing and building condos for end users who want to live in the building and the community. "We're seeing end-users, homebuyers, move-up buyers, downsizers," Fenton said. "There are people that want to live in the West Clayton neighbourhood." 

“The market has cooled, but what we’re seeing is that well-built homes, priced appropriately and located in desirable areas, are still selling,” he said. “Buyers are more selective right now, and that’s understandable. But they continue to show strong interest when the right home comes along.” 

Zenterra’s planned community, Clayton Crest, could eventually include seven buildings with over 720 homes. Atlin will have 115 condos and Butte will have 83 homes, Fenton said. Both buildings are expected to complete in 2028. Atlin is currently 80 per cent sold and Bute is closing in on 50 per cent sales, he said. 

Sales in this market also require a lot of hard work and persistent, dedicated marketing, and sales and programs, Fenton said. That means nurturing Zenterra's reputation as a developer and builder through an integrated approach.

"We're completely in-house with land acquisition, development, sales, marketing, construction, homeowner care, literally everything."

He said the firm specializes in the Fraser Valley market. Altogether, those factors help build trust with buyers and help to get sales inked.  

Another supportive factor in the area is the planned Hillcrest 184th Street SkyTrain station, expected to complete in early 2029. 

Allure breaks ground on Surrey tower 

Meanwhile, Allure Ventures broke ground April 15 on a condo tower in Surrey. SkyLiving is a 32-storey luxury condo project in Central Surrey which is to deliver 324 homes. The building will be located at the corner of 138A Street and 100th Avenue.

The company last year announced a presale program at the project designed to provide buyers with greater certainty. It offered rent-back and buy-back contracts that would see Allure repurchase the unit at the original contract price or rent back the unit at a premium price (with certain conditions). 

“Breaking ground at SkyLiving is an incredibly important milestone for our team,” said Garry Sangha, CEO of Allure Ventures, in a release. “This is a market that requires discipline, transparency, and a long-term view. Moving into construction reflects the strength of the project and the trust our buyers have placed in us.”

Harj Dhaliwal, executive vice president with Allure, said securing financing to move forward with construction has become more complex. "The parameters have changed a little bit," he told RENX. He said lenders require more information and deeper assurances before lending the capital. 

Allure said it havs sold 68 per cent of the homes in SkyLiving to a mix of investors and owner-occupiers.

"There are still investors out there and... they're looking for confidence right now," Dhaliwal said. "They want to make sure that if you're going to tie up some money here, that the project is going to go ahead. They want some assurances of that."

Dhaliwal noted the rent back and buyback programs attracted some interest from investors, but didn’t play a major role in getting to this stage. 

He said the company is starting excavation at the site and anticipates the tower completing in late 2028. 

Slow condo pipeline could eventually lead to shortage 

Fenton, with Zenterra, said barriers to starting new projects are everywhere including high construction costs, high development fees and taxes, uncertainty and the slow sales. "Everything's just been piled on (and) makes it incredibly difficult." 

He said if these conditions continue there will be very little housing delivered and there won't be enough supply to meet demand when it inevitably comes back. 

Dhaliwal agreed. He said an eventual shortage of new condos could be a real possibility. "If the projects are not moving forward… four or five years down the road, there will be a bit of a crunch," he said.